Wall Street Has Created ‘Zuck the Destroyer’

Facebook CEO's new laser focus on monetization could turn competitors into dust

Facebook’s (NASDAQ:FB) IPO, while an immediate disaster, might have had at least one good effect on the company — it seems to have shocked founder and CEO Mark Zuckerberg out of his “social mission” strategy and got him to focus on the business at hand.

Investors already are starting to get a sense of Facebook’s transformation; shares have been bid up nearly 25% in the past week, with hedge funds like Viking Global Management and Tiger Global Management have been aggressively buying up the stock.

But a more successful and aggressive Facebook could mean big problems for a variety of competitors. Here’s a look at some notable companies that could feel heat as Zuckerberg looks for the next business to conquer:

Yahoo!

Facebook already has made big inroads into Yahoo!’s (NASDAQ:YHOO) display business, but according to a recent BusinessInsider report, Facebook apparently is building a rival ad system that could really put the screws to YHOO.

The beauty is in the simplicity: The Facebook ad network would be just like any other system — the platform will essentially post ads across the web and track clicks. But there’s a twist in that Facebook will be able to leverage its massive data pool, which includes the email addresses, phone numbers and physical addresses of many of its members. Thus, marketers would be better able to see who bought their products after being exposed to a campaign.

This would be a game-changer, and plenty of reason for marketers to move over to Facebook — thus ripping apart a critical revenue stream for Yahoo!, which is already working to tighten the ship.

LinkedIn

LinkedIn (NYSE:LNKD), with its 187 million-strong user base, is the dominant player in the online recruiting market — not just in the U.S., but abroad, where more than 60% of its users reside.

LinkedIn’s early realization that social networking was an ideal way to get job seekers and employees in touch was brilliant, and has left many wondering why Facebook can’t do the same.

Well, maybe it can.

Just last week, Facebook launched the Social Jobs Partnership app — in concert with companies like Monster Worldwide (NYSE:MWW), Jobvite and BranchOut — where would-be employees and search for jobs by industry, location and other keywords. While the site has received some criticism about its bugginess, it already has attracted more than than 1.7 million job listings.

And Facebook isn’t exactly starting from zero on the job search front. The SJP page points out a particularly telling stat from the National Association of Colleges and Employers:

“Half of employers (50 percent) are using Facebook in their hiring process. A majority (54 percent) already using the social network anticipates Facebook becoming a more important part of the talent acquisition process in the near future.”

In other words, Facebook has its already wide overall user base, the programming groundwork and the eyes of employers. It’s now a matter of whether SJP gains traction.

Google

It’s a juicy target — Google currently enjoys a 60% market share of a $40 billion market, and has maintained its lead thanks to a ubiquitous brand (“Google” is literally synonymous with “search”), continued innovation and relevant results.

True, many others — even tech titans like Microsoft (NASDAQ:MSFT) — have tried and failed to truly shake up Google’s house.

But Facebook could be different. About half its billion-person user base visits the site on a daily basis, so the sheer draw of convenience could drive an onboard search engine. And again, Facebook’s horde of personal data could help the system produce highly relevant search results by using information like location, interests and interactions with friends.

Tom Taulli runs the InvestorPlace blog IPOPlaybook, a site dedicated to the hottest news and rumors about initial public offerings. He is also the author of “How to Create the Next Facebook.” Follow him on Twitter at@ttaulli. As of this writing, he did not hold a position in any of the aforementioned securities.

Based in Silicon Valley, Tom Taulli is in the heart of IPO land. On a regular basis, he talks with many of the top tech CEOs and founders trying to find the next hot deals and finding out which start-ups are stinkers.

A long-time follower of the IPO scene, back in 1999 Tom started one of the first sites in the space called WebIPO. It was a place where investors got research as well as access to deals for the dot-com boom. Tom also wrote the top-selling book, Investing in IPOs. In it, he covers all the aspects of analyzing an IPO, such as reading the prospectus, detecting the risk factors and understanding some of the arcane regulations. But don’t worry — if that process is too intimidating for you, thankfully Tom will do the legwork for you right here in the IPO Playbook blog.

Tom is routinely quoted in the media about upcoming deals with his interviews on CNBC and Bloomberg TV, but he is eager to take your questions too. You can message him on Twitter at @ttaulli. And feel free to weigh in via the comments section on any of his IPO Playbook posts.